Resource Commodities

Almaden Minerals (AAU) is a prime buyout target and that has been the case for some time now, notes Gerardo Del Real, editor of Junior Mining Monthly.

Despite that, the company is currently trading near 52-week lows for a combination of reasons. The most obvious and most recent reason for this is a well-known and influential newsletter service was recently stopped out of the stock.

That forced sell, combined with tax-loss selling season, has driven the stock to ridiculously low prices and provides us with an early Christmas present.

I have never personally used stops with any junior but the low prices provides an excellent opportunity and I’m taking full advantage of it. Let’s do some simple math. The company currently being assigned a market cap of Canadian $99 million or US$69 million.

The company is anchored by a robust treasury ( $17 million as of the latest reporting period), a mint conditioned mill which will be shipped from Alaska (with a $70 million price tag) that the company picked up for C$7 million in cash and stock and it has a gold equivalent resource of 4.5 million ounces across all categories.

The entire market cap in US dollars is backed by the value of the mill. The gold and silver is free. The exploration update and the cash is also free. That should show you how cheap the stock is.